Fed dudley was largely hawkish on the margin more than hintin that the Fed should hike this year using plural "rate hikes this year good news" and also saying "fed funds futures under-pricing the rate hike likelihood".

These remarks seem to be the catalyst for USD buying despite the weak CPI data (as expected) - nonetheless i think this is a good opp to add to AUD$ longs at 0.771 (at market) or lower (with 0.78tp) if possible as the remarks are likely to be faded later today once the real hard data ( CPI miss) sets in, I dont think these remarks will firm USD for long.

Nonetheless as it stands the opt implied probability of a Sept/Dec hike from fed funds futures trades at 12% and 37.8% marginally up on the day from 9% and 37.4% though i expect this to fade throughout the day along with USD demand.